Thursday, September 15, 2011The China Post news staff

Home sales in Taipei totaled 3,489 in August, the lowest in 30 months and less than half of the 7,051 prior to the implementation of the luxury tax, reported the Taipei City Government yesterday.

The figure was a decline of 3.5 percent from July, when sales declined by over 20 percent from June. In August, sales declined the most in the city's western Datong District by 40 percent, whereas prime districts such as Daan and Zhongzheng saw declines of 17 percent and 25 percent, respectively.

Hsu Chia-hsin, researcher with H&B Group, said the August figure was just a bit higher than during the global financial crisis in 2008. H&B meanwhile expressed pessimism for home sales in the fourth quarter, in which prices on the outskirts of the city are expected to drop further.

Sinyi Realty, meanwhile, said since 2006, Taipei's monthly home sales averaged 5,300. Yet since the announcement of the luxury tax sales have dropped to less than 5,000 for five months in a row. This indicates the effectiveness of the measure, Sinyi said.

The luxury tax imposes a tax of 10 to 15 percent on people selling their properties that they have owned for less than two years.

Yung Ching Realty said besides the luxury tax, the market also suffered from various external factors including the European debt crisis and a downgrade of the U.S.'s credit rating.

According to Yung Ching, Taipei's used home prices averaged NT$509,000 a ping in August. Each ping is 3.3 square meters.